India's rising household debt has helped drive demand but will lead to negative impact on growth in long-term: Report
5 years, 4 months ago

India's rising household debt has helped drive demand but will lead to negative impact on growth in long-term: Report

Firstpost  

An increase in the household debt-to-GDP ratio by one percentage point lowers output growth in the long run by 0.1 percent. Figure 2: India’s Household Debt While this rise in debt has helped drive demand after the shocks of demonetisation and GST, these signs are not promising over the long run. The paper further states that the negative impact of household debt on consumption and GDP intensifies as the household debt exceeds the threshold of 60 and 80 percent respectively. It can be argued that despite rising households debts in India, it might not be a worrying prospect as the country’s household debt-to-GDP ratio is still quite low—at around 11 percent—when compared to other BRICS nations—Brazil, Russia, China and South Africa.

India Household Debt Household Debt Long Negative Impact  lead  negative  report  indias  longterm  growth  household  helped  debt  households  rising  global  increase  ratio  impact  long

History of this topic

India’s sky-high household debt faces a year of reckoning
2 days, 22 hours ago

India’s sky-high household debt faces a year of reckoning

Live Mint  

The much-awaited boom of consumer spending has not materialized, with demand in both rural and urban areas remaining subdued. Countries such as Poland, Mexico and South Africa all have higher per capita income, but a lower level of household debt. Consumption tilt As of March 2024, housing loans accounted for 30% of total household debt. Motilal Oswal in a report …

Prudent policy: India should not let public debt eclipse the fiscal deficit
1 week, 2 days ago

Prudent policy: India should not let public debt eclipse the fiscal deficit

Live Mint  

In a 2020 address to the nation soon after the outbreak of covid, Prime Minister Narendra Modi cited age-old wisdom that advised against losing control of three things: fire, debt and disease. To cushion India’s economy from the pandemic’s shock, though, government spending had to vastly exceed its inflows, taking its fiscal deficit to 9% plus of GDP in 2020-21. …

India’s household debt is rising but low compared to other emerging markets: RBI
1 week, 6 days ago

India’s household debt is rising but low compared to other emerging markets: RBI

Deccan Chronicle  

Mumbai: The Indian household debt has been increasing over the past three years but remains relatively low compared to other emerging market economies, the Reserve Bank of India said in its December 2024 Financial Stability Report. “At 42.9 per cent of GDP in June 2024, India’s household debt is relatively low compared to other EMEs, however, it has increased over …

How to address India's falling household savings
3 weeks, 1 day ago

How to address India's falling household savings

Live Mint  

Savings have long been the backbone of financial stability in Indian households. Read this | Savings to consumption via debt—warnings from India’s households Key factors behind this trend include shifting consumption patterns and evolving investment behaviours among modern consumers. Urban consumers could benefit from digital micro-saving apps linked to everyday expenses, while rural households might prefer simplified savings accounts with …

India’s GDP growth shocker: Bad news can be good too
1 month, 1 week ago

India’s GDP growth shocker: Bad news can be good too

Live Mint  

India’s growth in gross domestic product of 5.4% in the three months ended 30 September, or the second quarter of 2024-25, was a shocker. It’s the lowest level seen since the third quarter of 2022-23 and a sharp drop from 8.1% growth in the same period last year and also from 6.7% in the first quarter of 2024-25. Given the …

India to contribute 20 pc of global workforce growth between 2023-2050, China share to decline: Report
1 month, 3 weeks ago

India to contribute 20 pc of global workforce growth between 2023-2050, China share to decline: Report

Live Mint  

New Delhi, : India is set to play a pivotal role in global workforce growth, contributing 20 per cent of it between 2023 and 2050, according to a report by Angel One Wealth. It said "By 2030 high-income households are expected to triple, while middle-income households will nearly double making India the fastest-growing nation in terms of per capita income". …

Inequality, unemployment, inflation in India are at all time high, says Parakala Prabhakar
8 months, 4 weeks ago

Inequality, unemployment, inflation in India are at all time high, says Parakala Prabhakar

The Hindu  

Inequality, unemployment among youth, inflation of various commodities and household debt are at an all-time high in the country, said political economist Parakala Prabhakar, in Chennai on April 16. Speaking at a national colloquium on the present political situation titled “The values at stake,” organised by Chennai Thinker’s Forum, Mr. Prabhakar, who is also the author of the book The …

ADB pegs India’s GDP growth at 7% in 2024-25, 7.2% next year
9 months ago

ADB pegs India’s GDP growth at 7% in 2024-25, 7.2% next year

The Hindu  

India’s economy is expected to remain robust over the next two years even though headline growth in the country’s Gross Domestic Product is forecast to slow from 7.6% in 2023-24 to 7% this year before improving to 7.2% in 2025-26, the Asian Development Bank said. “In India, growth is forecast to remain strong as rising consumption complements continued investment growth,” …

Raging inflation, stagnant wages forcing households into debt: Congress
9 months ago

Raging inflation, stagnant wages forcing households into debt: Congress

The Hindu  

The alarm bells are ringing for the Indian economy, but Prime Minister Narendra Modi has not heard them, the Congress said on April 9. The principal Opposition party’s statement was in response to a news report in The Hindu that quoted the findings of leading financial services firm Motilal Oswal on India’s growing household debt. Party general secretary Jairam Ramesh …

India’s external debt rises to $629.1 billion at end-June 2023: RBI
1 year, 3 months ago

India’s external debt rises to $629.1 billion at end-June 2023: RBI

The Hindu  

India’s external debt at end-June 2023 was placed at $629.1 billion, recording an increase of $4.7 billion over its level at end-March 2023 according to data released by the Reserve Bank of India on September 28. Excluding the valuation effect, external debt would have increased by $7.8 billion instead of $4.7 billion at end-June 2023 over end-March 2023. Net outgo …

Shedding more light on the debt dilemma
1 year, 5 months ago

Shedding more light on the debt dilemma

The Hindu  

The elevated levels of India’s fiscal deficit and public debt have been a matter of concern for a long time in India. Financial repression The debt-dynamics equation states that when there is no primary deficit, if the growth rate of GDP exceeds the effective interest rate paid on government bonds, the overall debt will decline. When the interest rate on …

India likely to have stable debt-to-GDP ratio going forward, says IMF official
1 year, 9 months ago

India likely to have stable debt-to-GDP ratio going forward, says IMF official

Deccan Chronicle  

WASHINGTON: India is expected to have a stable debt-to-GDP ratio going forward, a senior official from the International Monetary Fund said on Wednesday and recommended rationalization and simplification of Goods and Services Tax. According to Paolo Mauro, Deputy Director of the IMF Fiscal Affairs Department, there will be a gradual resumption of the rise in the global public debt-to-GDP ratio …

India likely to double home loans to $600 billion in 5 years: HDFC’s Parekh
2 years, 7 months ago

India likely to double home loans to $600 billion in 5 years: HDFC’s Parekh

The Hindu  

Demand for home loans will continue to remain robust and India should be able to double its home loans to about $600 billion in the next five years, HDFC Ltd. chairman Deepak Parekh said in a letter to shareholders. Mr. Parekh said despite the doubling of housing loans, India’s mortgage penetration would still remain low at 13% of the GDP. …

ADB pegs 2022-23 GDP growth at 7.5%
2 years, 9 months ago

ADB pegs 2022-23 GDP growth at 7.5%

The Hindu  

The Asian Development Bank forecasts India’s GDP growth to moderate to 7.5% in 2022-23 from an estimated 8.9% in 2021-22, but will pick up to reach 8% in 2023-2024. Food prices In its Asian Development Outlook report released on Wednesday the bank stated that food prices were expected to rise in tandem with increasing commodity prices Higher public capital spending …

India should worry about its public debt
3 years, 11 months ago

India should worry about its public debt

Live Mint  

NEW DELHI : Till 1972, India’s general debt—for the Centre and states—rose steadily to about 39% of gross domestic product and then fell sharply in 1974. Remember that the granular security level data for the Centre and states allows us to paint a much more accurate picture of the interest rate component’s contribution to changes in public debt. As our …

GDP data: Coronavirus pandemic may dent India's growth for years
4 years, 4 months ago

GDP data: Coronavirus pandemic may dent India's growth for years

India Today  

India is likely to post its steepest ever economic growth slump on record, just a couple of years after it earned the tag of the fastest-growing major economy in the world. The country is expected to register a sharp quarterly growth slump of 15-25 per cent - the worst since such data was first published in India in 1996 - …

Government debt-to GDP ratio to be at 80% by FY30: Report
4 years, 4 months ago

Government debt-to GDP ratio to be at 80% by FY30: Report

Deccan Chronicle  

Chennai: India’s general government debt-to-GDP ratio is likely to be at 80 per cent of GDP by FY30 and is unlikely to fall to the 60 per cent target even by FY40. India’s general government debt-to-GDP ratio is likely to be at 80 per cent of GDP by FY30 and is unlikely to fall to the 60 per cent target …

India's weak household consumption to curb economic growth: Moody's
5 years ago

India's weak household consumption to curb economic growth: Moody's

India TV News  

Moody's Investors Service on Monday said that India's weak household consumption will curb economic growth and weigh on the credit quality of Indian issuers in a range of sectors. Moody's has lowered its GDP growth projection for India for the fiscal year ending March 2020 to 4.9 per cent from 5.8 per cent. The major factors responsible for weakening economic …

Opinion | Lighten India’s debt burden to give growth a chance
5 years, 2 months ago

Opinion | Lighten India’s debt burden to give growth a chance

Live Mint  

With India’s economy growing at the slowest pace in six years, many wonder why consumers, companies and even the public sector can’t set it right. For a time, it was forgotten as India’s economy got a welcome boost from falling oil prices, a surge in lending from shadow banks, and a rise in public sector investment. Oil prices stabilized, alarm …

Union Budget 2019: High public debt detrimental to a country’s economy in long run
5 years, 6 months ago

Union Budget 2019: High public debt detrimental to a country’s economy in long run

Firstpost  

Public debt plays an important part in financing a government. India’s public debt, which is contracted against the guarantee of the Consolidated Fund of India, is divided into internal and external debt. In the past, public debt across the world has facilitated countries to develop critical infrastructure, which helps them in the long run. As per a December 2018 report …

The case for doubting India’s GDP numbers
5 years, 6 months ago

The case for doubting India’s GDP numbers

Live Mint  

Arvind Subramanian was the chief economic advisor to the Government of India from October 2014 to June 2018. Arvind Subramanian wrote an article in The Indian Express summarizing his findings on the econometric work he had done on India’s gross domestic product growth estimates. I concluded—without any statistical estimation—that India’s real GDP growth rate might be overstated by 1-1.5 percentage …

India is poised to uplift 2.5 crore households out of poverty by 2030, reports the World Economic Forum
5 years, 8 months ago

India is poised to uplift 2.5 crore households out of poverty by 2030, reports the World Economic Forum

Op India  

As per a report published by the World Economic Forum, India is steadily moving towards uplifting around 2.5 crore households out of poverty by 2030. The report titled ‘Future of Consumption in Fast-Growth Consumer Market India’ which released at the beginning of this year, had predictions that India will become the third-largest consumer market behind only the US and China …

How household debt becomes public debt
5 years, 11 months ago

How household debt becomes public debt

Live Mint  

Mumbai: On 1 February, finance minister Arun Jaitley will announce the interim budget and, invariably, attention will focus on the government’s public debt. Although bank bailouts get most attention for inflating public debt, they may not be the key reason for increased public debt globally, a new study by Samba Mbaye and others of the International Monetary Fund suggests. They …

Discover Related